September 26, 2013

Fun With Math - Right Wing Style!

Today, our friends on the Tribune-Review editorial board went with this:

Confirming the disconnect between the empty-promise pretenses on which ObamaCare was sold and its real-world effects in practice is a new report from Medicare actuaries that says health spending in ObamaCare's first 10 years will be about $621 billion higher than it would be without that train wreck of a law.
That's $7,450 more in health spending per family of four through 2022, according to Duke University health-policy expert Chris Conover, writing for The Apothecary, a Forbes blog.

$7,450? that's a lot of money! But of course, this is right wing math which almost always means it's misleading. And misleading it is. Here's how Conover came by that result, as quoted in Wonkette:

So I have taken the latest year-by-year projections [of additional health spending attributable to the Affordable Care Act], divided by the projected U.S. population to determine the added amount per person and multiplied the result by 4.

One economist interviewed by ThinkProgress, the Center for Budget and Policy Priorities’ Paul Van de Water, described this calculation as one of the stupidest things he’s read in a long time and likened it to arguing that college costs will increase for a “typical” family if the federal government adopts policies that help lower-income Americans afford college education. Yes, the nation will spend more on education if more students enroll in colleges and universities, but the “typical” student already attending college won’t; she or he will continuing paying tuition at more or less the same rate, while the newly-enrolled student will presumably benefit from some sort of subsidized tuition rate.

The same is true here. The so-called “typical” family that Conover describes already receives health care insurance through their employer. The existence of 30 million newly-insured people — many of whom will receive tax credits if they purchase insurance in the law’s exchanges — won’t do much to move their premiums in one way or another. (Health advocates hope that the law will slow the rate of growth in health care spending, but that’s a long-term proposition.)

Thinkprogress has more on Conover's misleading math. First from an MIT professor:

“This is a typically misleading use of data by opponents of Obamacare,” MIT’s Jonathan Gruber added. “The bottom line is that the government has consistently reported that Obamacare will raise national health spending by about 1 to 2 percent.” “This is a small fraction of the typical 5 to 7 percent annual growth rate in health care – and is a small price to pay for insuring 30 million or more Americans.”

And then in an update from Kenneth Thomas, a Poli-Sci professor from University of Missouri-St. Louis:

Forbes’ most-read story of the day (with over 26,000 Facebook shares and 3400 tweets as I write this) is simply false. Between all the new taxes and the premiums from the newly insured, you can cover the total increase in health care spending. The typical, already insured family isn’t going to see increases due to the rise in overall health care spending. You add 30 million new insured at a far lower cost than what we currently spend per person. And the editors didn’t catch a blatant error on present value.